Answer:
option (c) $875 per year
Explanation:
Given;
Average cost of collision claims for careful drivers = $500 per year
Average cost of collision claims for for poor drivers = $3000 per year
Poor drivers known by the company = 15%
thus,
Careful drivers = (100% - 15%) = 85%
Therefore,
Insurance company's breakeven price for the collision insurance
= (Poor drivers known × Average cost of collision for poor drivers ) +( Careful drivers × Average cost of collision claims for careful drivers)
= 0.15 × $3000 + 0.85 × $500
= $450 + $425
= $875 per year
Hence, the correct answer is option (c) $875 per year
Answer:
None of the above options are correct
Depletion amount in 2019 = $52.480
Explanation:
The Cost of Quarry (Depletion Base ) = $164000
Estimated Salable Rock (Units Extracted) = 20000 tons
Depletion Rate = Depletion Base /Units Extracted
Depletion Rate for 2018 = 164000/ 20000 = $8.2/ton
Units Extracted in 2018 = 4000 tons
Depletion amount in 2018 = Depletion Rate for 2018 *Units Extracted in 2018
Depletion amount in 2018 = $(8.2*4000) = $32800
In 2019
Depletion Base in 2019 = The Cost of Quarry - Depletion amount in 2018 = 164000-32800 = $131200
Estimated Salable Rock in 2019 (Units Extracted) = 20000 tons
Depletion Rate for 2019 = 131200/ 20000 = $6.56/ton
Units Extracted in 2019 = 8000 tons
Depletion amount in 2019 = $(6.56*8000) = $52480
Answer:
Net income for the year = $257,000
Explanation:
Retained earnings for the year= Net income - dividends paid.
Since no dividends were paid, retained earnings for the year = net income for the year. At the end of each accounting period, retained earnings are reported on the balance sheet, and the retained profits for the year are added to the beginning balance of retained earnings, to give a cumulative ending balance of $2,499,000.
therefore retained earnings for the year = ending retained earnings balance - beginning retained earnings balance = $2,499,000.-$2,242,000= $257,000.
Net income for the year is thus = $257,000 since no dividends were paid.
Answer:
This policy will lead to increase in birthrate.
Explanation:
Taxes imposed on individuals with children will be helpful in reducing birthrate, thus, curbing population growth. This is because taxes reduce the disposable income of the individuals. So people will prefer not to have children to earn a higher income.
When this tax is reduced through some policy, the disposable income of the people would increase. So people now would be able to afford to have children. This will lead to an increase in birth rate and thus population growth.
Answer:
There will be a difference in the income .
Absorption costing income will be lower as it transfers all the fixed costs to the ending inventory.
Variable costing income will be higher as it does not transfer the fixed costs to the ending inventory.
The difference will be of $ 104000
Explanation:
Increase in units 8000
Variable Fixed
Unit manufacturing costs of the period $24.00 $10.00
Unit operating expenses of the period 8.00 3.00
Total Unit Costs $ 32.00 $ 13.00
The net operating income under variable costing for the year will be $ 13* 8000= $ 104000 Lower than the net operating income under absorption costing. This is because the all fixed costs will be treated as period cost rather than product costs.
In variable costing the ending inventory will be $104000 lower than the ending inventory under absorption costing because the fixed costs will not be allocated to products.
Under variable costing, the units in the ending inventory will be costed at $32 each.Under absorption costing, the units in the ending inventory will be costed at $32+ $ 13= $ 45 each.
